Top-producing financial advisers with big books of business can expect to attract offers with significant recruitment packages.

Talented financial advisers are still in high demand, despite upheaval in the U.S. wealth management industry.

Whether their business model is built on attracting, training and mentoring recent graduates or luring successful professionals from competitors, many U.S. wealth management firms struggle to retain talented financial advisers. That applies to registered investment advisory shops and independent broker-dealers, wealth management divisions within banks and insurers, as well as regional broker-dealers and wirehouses.

“I think the talent pool for new advisers isn’t as deep as it once was, which is likely due to an ageing financial population that is retiring and a millennial group that is not finding the industry as an attractive career,” says John Bahnken, the president of wealth management at Citizens Bank.

There is some debate as to whether the wealth management industry’s talent shortage is perceived or real. That said, U.S. advisers’ average age was close to 60 as of last year, with 43% more than 55-years-old and a mere 11% younger than 35, according to research firm Cerulli Associates. Meanwhile, consulting firm Moss Adams estimated that by 2022 the U.S. wealth management industry is likely to face a shortfall of at least 200,000 advisers.

“We are clearly in a supply and demand mismatch, and, as an industry, we must find new ways to attract young talent to the financial advisory business,” says Bahnken. “We are building out our other licensed sales forces such as premier bankers and licensed bankers, which will allow us to organically grow our financial adviser headcount in future years.”

On the other hand, Coventry Edwards-Pitt, the chief wealth advisory officer of Ballentine Partners, an independent wealth management firm, disagrees that the industry is facing a serious talent shortage. She noted that there are a number of new entrants to the field coming out of school.

Edwards-Pitt also sees a lot of value in non-traditional hires – people who may not have had a great deal of financial-planning experience but do have the intellectual capacity to progress quickly up the admittedly steep learning curve.

Entry level financial advisers are often quizzed more on their “natural markets” — namely, places you belong to that may allow you access to rich people and any affluent connections you have. Those who are hired can find the role difficult to adjust to, and therefore attrition among the junior ranks remains high.

Why financial advisers stick around

But firms that are continually upgrading their platform and technology are much more likely to retain their best advisers than those that are laggards in that area, suggests Mark Elzweig, the president of the Mark Elzweig Company, an executive recruiting firm that specialises in placing advisers.

“When a firm is investing the resources to make sure to have the broadest menu of products and services – continually investing money in technology in order to help the adviser deliver those services more efficiently – that’s what locks an adviser into a firm long-term,” Elzweig said. “An adviser is going to be very reluctant to join a firm in which the platform and technology are substandard or not as good as where they are now.”

There are a variety of other reasons why successful advisers might consider moving to another firm, including lack of referral opportunities, issues with management, financial incentives and various factors detracting from the ease of doing business.

“We are keenly focused on these issues, and our adviser attrition is below the industry average,” Bahnken says.

For both Citizens Bank and Ballentine Partners, encouraging adviser loyalty starts with each firm’s extensive program, which begins with the initial onboarding process and continues on an ongoing basis through an adviser’s career.

Edwards-Pitt said that a vital element is fostering a work culture that is collegial and collaborative.

“Through our leadership pipeline, we give employees a clearly defined career path and an understanding of what skills they need to develop to succeed at our firm,” she says. “We not only talk about the opportunity for growth, but we prove it by promoting internally and having existing examples of senior executives who started in more junior positions.

“We have structured our practice in a way that gives junior and mid-level employees independence and autonomy, giving them the opportunity to take on as much as they want and can handle and to prove their abilities,” she said.

While it is the experienced big-producing advisers who garner headlines and huge recruitment packages when they jump firms, the wealth management industry needs a continual intake of talented graduates and mid-stream career-changers. That’s an opportunity if you’re considering a career as a financial adviser.